1.2 Million Walmart Associates to Receive Pay Increase

In the wake of its decision to shutter 269 stores and warehouse clubs – including 102 small-format Express locations – Wal-Mart Stores Inc. is entering the second phase of its hourly pay increase for more than 1.2 million associates.

Employees of the world's largest retailer will receive a pay increase as part of the company’s two-year $2.7 billion investment in workers on Feb. 20, which the company says will be one of the largest single-day, private-sector pay increases ever.

Walmart is also implementing new short-term disability and simplified paid time off (PTO) programs to expand support for associates dealing with extended health issues and provide associates greater control over their paid time away from work.

"We are committed to investing in our associates and to continuing to simplify our business," said Judith McKenna, Walmart U.S. COO. “Our customers and associates are noticing a difference. We’re seeing strong increases in both customer experience and associate engagement scores," evidence of which she said is "five straight quarters of positive comps in our U.S. business.”

While some media reports hinted that the retailer's decision for last week's announced store closures was attributable to its associate wage investment program initiated in April 2015, the Bentonville, Ark.-based chain said the second phase investment was already accounted for in the financial outlook presented at its annual analyst meeting in October.

The changes that will affect more than 1.1 million hourly associates include:

• All associates hired before Jan. 1, 2016 will earn at least $10 per hour
• New entry-level associates will continue to start at $9 per hour and move to at least $10/hour after successfully completing the company’s new retail skills and training program known as Pathways.
• Associates already earning more than $10 per hour will receive an annual pay increase in February rather than waiting until their anniversary date.
• Raising the starting rate of its non-entry level hourly pay bands. Anyone earning below the new minimum will automatically move up to the new minimum.
• Associates at or above their pay band maximum will receive a one-time lump sum payment equal to 2 percent of their annual pay.

When these changes go into effect, Walmart’s average full-time hourly wage will be $13.38/hour. The average part-time hourly wage will be $10.58/hour.

PTO

Walmart is also launching a new, simplified PTO policy, effective March 5, 2016, that will streamline paid vacation, sick time, personal time and holiday time into one category. The one-day wait to use sick time will be eliminated, as promised. When the plan rolls out in March, both full- and part-time associates will earn PTO based on tenure and hours worked.

Details of the new plan include:

• No waiting. PTO is available to use as soon as it’s earned and can be used for almost any reason.
• Full-time hourly associates can carry over up to 80 hours (48 hours for part time) of PTO from year to year.
• Any unused hours at the end of the year above the 80 hour and 48 hour limits will automatically be paid to hourly associates in the first paycheck every February.
• Associates will also keep any existing and accrued sick and personal time. These balances will be kept separate, to be used for certain circumstances once all available PTO is used.

In addition to PTO, Walmart is providing a new, short-term disability basic plan at no cost to full-time hourly associates. Effective Jan. 1, 2016, the plan offers more financial protection to workers who need to be away from work for an extended period of time due to their own medical needs such as an illness, injury or having a baby. The basic plan will pay 50 percent of a worker’s average weekly wage, up to $200, for up to 26 weeks. Walmart is also offering a Short Term Disability Enhanced plan, which costs less than the company’s prior voluntary plan and provides more coverage. Associates would receive up to 60 percent of their average weekly wage with no weekly maximum for up to 26 weeks.

Walmart operates stores under 72 banners in 28 countries, and e-commerce websites in 11 countries.